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What Your CEO Is Reading: North Dakota’s Boom

Every week, CIO Journal offers a glimpse into the mind of the CEO, whose view of technology is shaped by stories in management journals, general interest magazines and, of course, in-flight publications.

Gregory Bull / AP Photo

An oil derrick outside of Williston, N.D.

North Dakota went boom. North Dakota has had its share of oil boom and busts, but today’s activity in the 150,000 square mile Williston Basin in the western portion of the state has been like no other, writes the New York Times’s Chip Brown. Recent advances in horizontal drilling and hydraulic fracking, where a frothy stew of water, sand and chemicals is pumped into tight rock formations to create tiny hairline channels for the oil or natural gas to flow, has turned the once-sparsely populated region into the nation’s second largest oil producing state. As long as prices stay above $60 a barrel, oil will be part of North Dakota’s economy for at least a generation. “The people who are there appear to have weighed the benefits against the costs,” writes Brown. And given the state’s long history of hardship, they may not feel entitled to hold reservations about social and environmental costs. “It’s our gold rush, our Silicon Valley. It reverses decades of anxiety about out-migration and rural decline and death,” a humanities professor and local columnist tells Brown. “We aren’t going to do anything to jeopardize it. People aren’t interested in stepping back.”

‘Let’s do lunch’ works.Harvard Business Review contributor Lakshmi Balachandra wondered whether business deals improve when discussed over a meal. So she devised several experiments where MBA students were divided up and asked to negotiate a complex joint venture agreement. Some hammered out deals over a meal in a restaurant, others negotiated in a business conference room without a meal. A third group also worked in a conference room, but while sharing a meal. Balachandra found that joint venture deals negotiated while dining produced 12% greater profits than those deals negotiated sans food. There may be a biological reason for this. Consuming glucose enhances complex brain activities and bolsters self control. And there’s other research that shows that “unconscious mimicking behaviors of others leads to increased pro-social behaviors.” When people eat together they use the same movements which in turn may induce positive feelings toward the other party. Short answer: Keep the corporate Amex card, your business lunch is money well spent.

Libor lies revealed in rigging of $300 trillion benchmark. Despite its role as the global benchmark “for more than $300 trillion of contracts from mortgages and student loans to interest-rate swaps,” the London interbank offered rate, or Libor, was about as policed as a lemonade stand collection box. “The scandal demonstrates the failure of London’s two-decade experiment with light-touch supervision, which helped make the British capital the biggest securities-trading hub in the world,” writes Bloomberg Markets Magazine’s Liam Vaughn and Gavin Finch in a soup-to-nuts story on what could be “the biggest financial fraud of all time.” Given little training and scant oversight, traders at Deutsche Bank AG, UBS AG, Barclays, RBS and other banks colluded to publish borrowing rates in 10 currencies that did not fit any economic reality beyond setting numbers to their banks’ benefit. The manipulation went on for years, even after supervisors were aware of what was happening. “When a bank can benefit financially from doing the wrong thing, it generally will,” Shelia Bair, a former chairman of the Federal Deposit Insurance Corp., tells Bloomberg.

The factors that render the electrical grid vulnerable to cyber attack are strikingly similar to the cyber risk issues faced by health care, financial services, and other industries. But one recent malware campaign targeting utilities shows just how exposed the grid remains to cyber threats.